A Baylor Lawsuit Against SEC Would Not Be A Slamdunk

The term “tortious interference” has become synonymous with conference realignment the past couple of weeks. Many believe Baylor is preparing to file a tortious interference claim against the SEC if the move by Texas A&M becomes official. What exactly does that mean?

Tortious interference is when a person or entity who is not a party to a contract (or business relationship, but we’ll stick with the term contract to cover both) intentionally convinces one of the parties to the contract to break that contract.

In the conference realignment scenario, Baylor could claim that the SEC is intentionally inducing Texas A&M to break its contract with the Big 12.

In order to be successful in their claim, Baylor (and any other schools who joined in) would have to prove certain “elements” in order for the case to go to trial. Before the case goes to trial, a judge could grant a motion to dismiss or a motion for summary judgment by the SEC if he/she doesn’t believe each of these elements is established.

The elements of a typical tortious interference claim, although it varies by jurisdiction, are as follows (first in legalese and then translated to English):

The existence of a contractual relationship or beneficial business relationship between two parties.

Knowledge of that relationship by a third party.

Intent of the third party to induce a party to the relationship to breach the relationship.

Lack of any privilege on the part of the third party to induce such a breach.

The contractual relationship is breached.

Damage to the party against whom the breach occurs.

The first two are easy hurdles for a plaintiff to clear. There is a relationship between Texas A&M and the Big 12, and the SEC is aware of that relationship.

By now most of you have heard there’s an issue with the third factor. A plaintiff would have to prove the SEC intentionally induced Texas A&M to breach the contract. All the evidence made public so far points to Texas A&M choosing to leave the Big 12 before the invite from the SEC.

However, there may be a wrinkle with regards to last summer’s conference realignment discussions. Did the SEC approach A&M then? If so, did they know A&M leaving the conference could result in current television contracts being renegotiated or canceled? I’m told Baylor could try and satisfy the third factor regarding inducement if they can prove the answers to those questions are yes.

Another issue the SEC could argue is whether any contract is really being breached. In terms of membership, the Big 12 is wholly governed by its Bylaws, which is a document that is not signed but is adopted by vote of the members. There is no other signed contract or agreement either between all of the members or between each member and the conference.

The Bylaws provide for a member to leave the conference upon notice and payment of a specified fee. If A&M gave the proper notice and agrees to pay the fee, what is A&M breaching by leaving? Baylor might argue the breach is with regards to the television contracts, but without a copy of the contracts I can’t comment on that. If what’s been made public is true – that there is a provision that allows for renegotiation in one or both tv contracts if the conference drops below ten members – Baylor could argue the breach exists there. Whether that’s enough to satisfy a judge is anyone’s guess.

The other factor I think the SEC might claim the plaintiff couldn’t prove is the last relating to damages. The plaintiff would have to claim actual damages, such as monetary losses. Now, if ESPN were to drop or renegotiate (for a smaller value) their television contract with the Big 12 because of A&M’s departure, then damages are easy to prove. Otherwise, I don’t think they have a case. There’s no reason to believe that the loss of A&M alone would cause these contracts to be renegotiated or dropped, especially if the Big 12 carries forward with the plan to add a team to replace A&M. Clay Travis wrote a great piece on why there won’t be any lost television money to claim as damages.

Post Your Comment

Post Your Reply

Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out.